Australia in 'high state of readiness' to support US in Iraq

Defence Minister David Johnston and Foreign Minister Julie Bishop, with US Secretary of State John Kerry.

Australia is a at "high state of readiness" to assist the United States with further airstrikes targeting Islamic State terrorists in Iraq, Defence Minister David Johnston says.

The New York Times is reporting the US has begun mobilising a coalition of allies and is considering asking them to become involved in airstrikes in Iraq.

Defence Minister David Johnston said Australia has so far only contributed humanitarian aid, with troops dropping energy biscuits and water to trapped refugees. But he has told the ABC Australia might do more.

"We're at a high state of readiness. We're at a good state of readiness at all times. Apart from saying that, I wouldn't want to say any more," Senator Johnston told the ABC on Wednesday night.

But the minister added Australia has a "lot of capability" at its "fingertips" including the "incredibly capable Super Hornets".

"Now, that's an obvious first port of call were we to consider it necessary to participate with our friends and our ally," the minister said.

But he said both the US and Australia wanted to see a "more inclusive government in Baghdad" before committing to any large scale military mission.

"The Secretary of State and Julie Bishop and I discussed that we think it's appropriate that a more inclusive government in Baghdad should be established before we start talking to them about what level of military assistance from the sort of group of allies who are so concerned would start to materialise.